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Digital asset marketplace Figure Markets has launched YLDS, the first yield-bearing stablecoin registered as a public security with the U.S. Securities and Exchange Commission.

The stablecoin, issued through Figure Certificate Corporation, operates on the Provenance Blockchain and pays holders an annual return at the Secured Overnight Financing Rate minus 50 basis points.

YLDS accrues interest daily and distributes payments monthly in either U.S. dollars or YLDS tokens. 

It is backed by securities similar to those held in prime money market funds. The token supports peer-to-peer transfers and can be exchanged for U.S. dollars or other stablecoins at any time, with fiat off-ramps available during U.S. banking hours.

Stablecoins have grown into a $200 billion asset class, widely used for payments and cross-border transactions. Leading stablecoins such as USDT (USDT) and USDC (USDC) do not distribute yield from reserve assets, primarily U.S. Treasuries. 

This has led to the rise of tokenized money-market funds and investment products like BlackRock’s BUIDL, Franklin Templeton’s BENJI, and Ethena’s USDE (USDE). These assets are increasingly used as collateral or to earn returns on blockchain-based holdings.

Figure Markets transactions 

Figure Markets is the digital asset division of Figure Technologies, a company co-founded by former SoFi CEO Mike Cagney. The firm has processed over $41 billion in blockchain-based transactions and originated $11 billion in home equity lines of credit using the Provenance Blockchain. 

Figure Markets filed with the SEC in October 2023 to launch its yield-bearing stablecoin.

The company expects YLDS to gain adoption among developers integrating blockchain-based assets into decentralized finance and payment applications.

“We see tremendous applications for YLDS,” Cagney said. “Exchange collateral, cross-border remittances, and payment rails are immediate opportunities, but this is just the beginning of a larger shift of traditional finance to blockchain.”